Microsoft opens UK cloud gaming studio

Microsoft is launching a London based gaming development studio focusing entirely on cloud-based games for tablet, TV and mobile devices as the company looks to address the consumer shift from packaged goods to connected products.

The Lift London Studio is led by former Rare Games studio director Lee Schuneman and will incubate other start-up games studios as well as developing its own products.

Lift London will also develop games for platforms beyond Windows 8 and Xbox – such as Android, Amazon and Apple’s iOS – as Microsoft bids to make a landgrab for the cloud-based gaming ecosystem.

Cloud-based games also have the benefit of shorter development lead times and the option to serve in-game ads to boost revenue.

While Microsoft will still continue to focus on disc-based blockbuster games such new editions of Halo and Call of Duty as it approaches the anticipated launch of its new Xbox console, but Lift London aims to expand the reach of the Xbox service beyond the console.

Microsoft’s interactive entertainment business leader Phil Harrison said at the studio’s launch in London yesterday (10 January) everything Lift London does will have “increasingly deep” social features will be enhanced by the Xbox Live network.

He continued: “That’s the key strategic shift we’re making with our business, moving from being a maker of packaged products to being an operator of connected services. You will see that in the people we hire, the companies we partner with and the business models we develop and the creative expression we bring to life on all of these platforms.”

Sales of computer games in the UK surpassed that of DVDs and other video formats for the first time in 2011, making it the country’s biggest entertainment sector, according to the Entertainment Retailers Association. Total games sales totalled £1.93bn, while video sales pulled in £1.8bn.

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